Handshake Agreements

Posted August 5, 2025 • By Arjun Verma

When you hear the term “handshake agreement,” you might picture two people smiling and shaking hands after making a deal. But can something so simple really count as a legal contract?

Surprisingly, yes.

What Is a Handshake Agreement?

A handshake agreement is a type of verbal contract, an agreement made by spoken words rather than written ones. For example, let’s say your neighbor promises to pay you $100 to mow their lawn all summer. You both agree, and you shake on it. That’s a handshake agreement.

While it seems informal, this kind of deal can be legally binding, but not always.

The Basics of a Legal Contract

Whether it’s written or spoken, a contract must have three basic parts to be considered valid in court: an offer, where one party offers something (like money, goods, or services). It must have an acceptance, where the other party agrees to the offer. And it must have consideration, where each party gives something of value (like money for services). If your handshake agreement includes these elements, it's technically a valid contract.

Will a Handshake Agreement Hold Up in Court?

Yes, but it’s risky. Courts do recognize verbal agreements in many cases, but they’re much harder to prove. Without anything in writing, it becomes your word against the other person’s.

You’ll want to show text messages, emails, or DMs that reference the deal, provide witnesses who saw or heard the agreement, and proof of performance (like receipts, photos of the work, or bank transfers). For example, if you mowed your neighbor’s lawn and they won’t pay, showing dated pictures of the lawn and messages confirming the job could help you in court.

When a Written Contract Is Required

Some agreements must be written to be enforceable. This concept is called the Statute of Frauds. Here are some examples: sales of land or real estate, contracts that take more than one year to complete, agreements over a certain dollar amount (varies by state), and promises to pay someone else’s debt.

What should you do?

Maybe you’re selling sneakers, tutoring a friend, or getting paid to edit videos. These are all situations where you might make a verbal agreement. Even if it feels casual, it’s smart to write it down. A quick message or email can help avoid confusion later.

Disclaimer: This article is for educational purposes only. It is not legal advice. If you need help with a legal issue, speak to a qualified attorney.

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